If you receive SSI or Medicaid and are awarded money from a personal injury settlement, that money can put your benefits at risk—unless the funds are handled correctly.

In Connecticut, there is a well-established solution: a Special Needs Trust.

This article explains why a trust matters, who helps set it up, and what to do before settlement funds are released.

Why a Settlement Can Cause Loss of SSI

SSI is a needs-based program. To remain eligible, a person generally cannot have more than $2,000 in countable assets.

A personal injury settlement—even one meant to compensate for pain, disability, or medical care—is considered countable income unless it is placed into a properly structured trust.

Without planning:

• SSI payments can stop

• Medicaid coverage can be suspended

• Re-qualification can take months or longer

The Solution: A Special Needs Trust

A Special Needs Trust (SNT) allows a person with a disability to receive settlement funds without losing SSI or Medicaid, as long as the trust complies with federal and state rules.

The most common option after a personal injury settlement is a:

Pooled Special Needs Trust (d)(4)(C)

This type of trust:

• Is designed specifically for settlement proceeds • Is managed by a non-profit trustee • Keeps funds separate for each beneficiary • Allows money to be used for approved expenses that improve quality of life • Preserves eligibility for SSI and Medicaid

Who Helps Set Up These Trusts in Connecticut?

PLAN of CT (Planned Lifetime Assistance Network of Connecticut)

PLAN of CT is the primary Connecticut-based nonprofit that administers pooled special needs trusts.

They work with:

• Injury victims

• Families

• Personal injury attorneys

• Elder law and special needs planning attorneys

PLAN of CT acts as trustee, while a Connecticut attorney handles the legal setup.

Contact information:

📞 PLAN of CT

Phone: (860) 523-4951

When Should the Trust Be Set Up?

Timing is critical.

A special needs trust should be:

• Established before settlement funds are disbursed • Coordinated with the personal injury attorney • Structured to comply with SSI and Medicaid rules

Depositing settlement funds into a personal bank account—even briefly—can create eligibility problems.

What Can Trust Funds Be Used For?

Trust funds can pay for items and services that SSI does not cover, such as:

• Medical care not covered by Medicaid

• Therapy and rehabilitation

• Transportation

• Education and training

• Personal care aides